Accurate Numbers, Inc B) C) D) $\begin{array}{|l|r|r|}\hline \text { Interest expense } & 6,000 & \\\hline \text { Cash } & & 6,000 \\\hline\end{array}$

Accurate Numbers, Inc., issued $100,000 of 10 year, 12% bonds dated April 1, 20X1, for $102,360 on April 1, 20X1. The bonds pay interest on April 1 and October 1. Straight-line amortization is used by the company. What entry is needed at October 1 for the first interest payment?
a)
$\begin{array}{|l|r|r|}\hline \text { Interest expense } & 5,882 & \\\hline \text { Premium on bonds payable } & 118 & \\\hline \text { Cash } & & 6,000\\\hline\end{array}$

b)
$\begin{array}{|l|r|r|}\hline \text { Interest expense } & 6,118 & \\\hline \text { Discount on bonds payable } & 118 & \\\hline \text { Cash } & & 6,000 \\\hline\end{array}$

c)
$\begin{array}{|l|r|r|}\hline \text { Interest expense } & 6,000 & \\\hline \text { Premium on bonds payable } & 118 & \\\hline \text { Cash } & & 6,118\\\hline\end{array}$

d)
$\begin{array}{|l|r|r|}\hline \text { Interest expense } & 6,000 & \\\hline \text { Cash } & & 6,000 \\\hline\end{array}$

A) Choice A
B) Choice B
C) Choice C
D) Choice D